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They need to buy a residency on the island and live there at least half of the year. They also have to donate $10,000 to a nonprofit approved by the Puerto Rican government. In exchange, they get a 0% tax rate on capital gains such as profits from selling estate stocks or cryptocurrencies.
The decline stemmed from familiar rural culprits: declining manufacturing, lack of health care, falling birthrates, brain drain and climate change. Even Puerto Ricos storied capital, San Juan, might have more in common with a faded Rust Belt hub like Detroit than with a coastal superstar city.
Specifically, a U.S. citizen who becomes a bona fide Puerto Rico resident and moves his or her business to Puerto Rico (thus, generating Puerto Rico sourced income) may benefit from a 4% corporate tax/fixed income tax rate, a 100% exemption on property taxes, and a 100% exemption on dividends from export services.
U.S. Possessions. For foreign tax credit purposes, all qualified taxes paid to U.S. possessions are considered foreign taxes. For this purpose, U.S. possessions include Puerto Rico, the U.S. Virgin Islands, Guam, the Northern Mariana Islands and American Samoa.
Puerto Rican residents are taxed in Puerto Rico on their worldwide income, no matter where the income is sourced. Puerto Rican non-residents are only taxed in Puerto Rico on their Puerto Rico-source income. Income for services performed is sourced to Puerto Rico based on where the services are performed.
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Generally, if you are a Puerto Rico bona fide resident, you must file a Puerto Rico tax return. If you are not a bona fide resident of Puerto Rico, you must file both a Puerto Rico tax return and a U.S. tax return. If you are a member of the United States Armed Forces, special tax rules may be applied.
Located in the Caribbean Sea, the U.S. territory of Puerto Rico is a spectacular tax haven for businesses and individuals. Much of this is due to Act 60, a piece of legislation passed to boost economic development on the island.
There are no tax treaties between foreign countries and Puerto Rico.
Choosing Puerto Rico as an offshore jurisdiction offers a range of benefits, including tax incentives, which make it well worth consideration.
The foreign tax credit is intended to relieve you of the double tax burden when your foreign source income is taxed by both the United States and the foreign country. The foreign tax credit can only reduce U.S. taxes on foreign source income; it cannot reduce U.S. taxes on U.S. source income.

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